Based on the circular flow diagram, which of the following is part of a circular flow?
a. rest of the world’s expenditures on exports and government purchases of goods
b. household expenditures on goods and government purchases of goods
c. household expenditures on goods and firms paying wages
d. taxes paid to government and firms borrowing for investment
c. household expenditures on goods and firms paying wages
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In order to measure gross domestic product, we can follow
A) three approaches: the expenditure approach, the income approach, and the production approach. B) only one approach: the circular flow approach. C) two approaches: the expenditure approach and the income approach. D) only one approach: the national accounts approach. E) three approaches: the expenditure approach, the income approach, and the market-based approach.
A profit-maximizing firm always
a. sells its output at P = MR. b. produces at the output at which MR = 0. c. hires labor until the MRP of labor = 0. d. produces every unit of output for which MR > MC.
An increase in the price of oil will likely cause which of the following?
A) increase the markup in the Phillips curve equation B) increase the sum "m + z" in the Phillips curve equation C) increase the natural rate of unemployment D) all of the above E) none of the above
In Figure 15.4, an increase in the money supply from $100 billion to $135 billion will cause a
A. Shift in the money demand curve. B. Decrease in aggregate demand. C. Decrease in the interest rate. D. $40 billion increase in investment.